What Small Businesses Should Know About Pay Per Click Marketing

Image What Small Businesses Should Know About Pay Per Click Marketing
By Mike Brown

As a small eCommerce business competing for online shopping dollars, there are a plethora of marketing avenues available to in which to market your products or services.
One of the more effective choices among these is Pay-Per-Click (PPC) advertising, with the most popular programs available through Google (AdWords), Yahoo (Sponsored Search), and Bing (previously MSN AdCenter).

Starting a PPC campaign is challenging; maintaining it is a full time job. For those who have tried and failed - do not fear, there is hope and a PPC campaign can be profitable! You just need to know some of the basics, how to monitor performance, and how to adjust.

The Basics

The first step to getting a PPC campaign off the ground is deciding on an ad spend budget. This can be quite difficult, especially if you have never tried this type of campaign in the past. When deciding on an initial budget, it's important to keep in mind that the more you can allot, the more data you will have with which to make decisions. For example, if you only spend $50 in a month, your click and sales volume will be such that it will be difficult to get a sense of which keywords, ad copy, landing pages, etc. work and which don't. A $500 budget on the other hand will bring in more data and help in determining future keyword bid adjustments and other areas of necessary optimization.

The second step in the process is the building of an initial keyword set. The goal here is to put together a group that is both large enough to extend a reach to as many target customers as possible and will provide enough data to make educated campaign adjustments. How many keywords is enough? That really depends on the number of products on the site.

For example, if you sell 50 different products, there are likely at least 1000 appropriate keywords (via numerous variations) with which you could bid on to start the campaign.
Another important aspect in setting up an initial keyword list is the match type applied to each keyword; usually being exact, phrase, or broad. Do some research on how these matches work and what kinds of searches you may be found for.

At this point you may be asking, "Won't more keywords cost me more money?" The answer is no; cost has nothing to do with the number of keywords you have in your campaign, but rather the ad spend budget you set.

After your campaign launches and your ads begin garnering traffic and driving orders, there will be a great deal of data with which to both measure performance and make adjustments.

Campaign Monitoring and Adjustment

Some of the more important metrics to keep an eye on are click thru-rate (# of clicks/# of impressions, or appearances of an ad), conversion rate (# of sales/# of clicks), and return on ad spend (revenue/spend).

Click-thru rate will give you an idea of how shoppers are viewing your ad. If your click-thru rates are very low, take a close look at your titles and descriptions. Is the ad compelling enough? Is there a call to action? Does it fully explain your current promotion or sale?

Conversion rate helps to measure the effectiveness of the landing page, product selection, pricing, etc. If conversion rate is low (often less than 1%), evaluate the page to which you are sending the user and what they are seeing there, compared to the search query they used to arrive on said page.

Return on ad spend (ROAS) is likely the most important metric one should continuously monitor, as it shows the number of dollars you are making for every one dollar spent on PPC advertising. What is the correct ROAS goal? This is different for each business and something that should be established before a PPC campaign even begins.

As you continue to monitor these and other appropriate performance metrics, you will begin to get an idea of what works and what doesn't for your individual campaign.
With this information, begin to test new keywords, different ad copy, and individual keyword bids to determine how these changes affect your ultimate return.

PPC campaign management is certainly challenging and sometimes frustrating, but for the vast majority of sites, there is indeed a combination of steps one can take to drive sales and produce a positive return!

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